Friday, February 02, 2007

May You Live in Busy Times

It looks like I may shortly be putting my money where my mouth is, as far as buying, rehabbing, and selling houses. We made an offer on a house on Tuesday, they accepted on Wednesday, and both sides are apparently motivated to get it done quickly, so hopefully closing won't be too far out.

I'm going to be mightily curious to see how all this works out in the end. It's a 3-1 built in the 1930s, 1400 sq. ft. or so, in a decent neighborhood really close to town. Hardwood floors throughout and some neatoriginal built-ins in the living room and dining room. It's got some less-than-perfect features (the third "bedroom" is pretty tiny, and the hookup-ups for the washer-dryer are actually in that room, in a big closet) and it needs a lot of cosmetic work.

The sellers were sort of schizophrenic, as they did a few things (new countertops in the kitchen, a new vanity in the bathroom) but managed to ignore other things, like switch plates for outlets and couldn't be bothered to actually nail the trim to the wall in places. The exterior was recently painted but nothing was painted in the interior, despite it desperately needing it. The hardwood floors had been refinished but they left the cheap vinyl tile in the kitchen and bathroom, which was literally peeling off in huge chunks. No attempt at landscaping or anything to add any curb appeal.

The price, though, was definitely right, as it was originally listed at $90,000, didn't sell, they dropped it to $78,500, didn't sell, then they took it off the market and rented it for awhile, got tired of that, and were ready to re-list it at $65,000, just to get some needed cash out of it. (The seller's real estate agent works in the same office as our realtor, so we got a bit more of the backstory than would normally be the case.) We offered $60,000 and they accepted, without bothering to counter.

I'm not going to get rich on the deal, as it's forever going to be a starter home with some bumps and flaws, but all the work needed is of the cosmetic nature, and I can realistically (fingers crossed) put $5,000 in repairs into it, do nearly all of the work myself in a month, and then list it at $90,000, hoping to get $85,000 for it. Our realtor said he thought it was reasonably priced at $78,500 and would have moved at that price as is if they'd been a bit patient, so I don't think I'm shooting too insanely high.

Backing out assorted fees and expenses and what-not, I'd be looking to likely make $10,000-$15,000, which isn't too bad for giving up my weekends and a few nights for a month, even accounting for Uncle Sam eventually getting his cut in taxes. Repeat the process 2-3 times a year and it starts adding up to some decent cash.

Aside from that stuff, I've been merrily expanding my blog empire, launching a new NASCAR blog as well other sundry affiliate sites. Still largely knocked on my ass, as far as income from my affiliate endeavors not recovering from the UIGEA, but the needle is at least moving in the right direction again. And, in the world in which lemons make great lemonade, I'm at least being smarter this go around and not lumping all of my eggs in one basket, as the new sites I'm working on are a pretty random-ass assortment of themes and models, as far as where income potentially comes from.

I'm pointedly refraining from commenting on any of the continued fallout of payment processors and dwindling traffic on online poker sites. Come up with a solution that doesn't involve the ACH system and the US financial infrastructure in general, and I'll be excited. Continue to ignore the real issue and keep trotting out "new, exciting!" transaction methods that use the existing framework in the US, that are just going to get shut down, umm, not so exciting.


Fuel55 said...

Living in a city where a teardown on a postage stamp lot is a minimum of $900,000 - buying an entire house and its land for $65,000 just boggles my mind.

Take this 79 year old junkie for instance:

ScurvyDog said...


It is pretty amazing the huge difference in real estate from place to place.

I still freak out slightly at the thought of owning three properties, all with outstanding loans, but then I start doing the math and realize that the total amount of money involved is still just a fraction of what people in other parts of the country/world pony up for just a single house.

'Tis crazy, too, that the house our offer of $60,000 was accepted for needs lots of fixing up and updating, but it's more than habitable, so it's not even a junker that needs a complete remodel, with gaping holes in the walls and ceiling, etc.

I guess it's all relative, though, as it cuts both ways. It's hard to get more than $90,000-$100,000 for starter houses like this one in the area, so while you can get into the game on the relative cheap, you're just never going to see crazy appreciation and profit when you unload it, either.